News

E-retailers enjoy a 24% jump in Thanksgiving sales

November 26, 2015 01:45 PM

E-commerce sales were up 24% on Thanksgiving morning, reaching the half-billion-dollar mark, as shoppers jumped on early holiday deals, even though the discounts weren’t as steep as last year’s, according to data from Adobe Digital Index.

Shoppers on smartphones and tablets drove 52% of the traffic, with the smartphone share of mobile purchases growing 30%, to 17% this Thanksgiving from 13% during the same period in 2014, according to the Adobe Inc. data that tracks visits to more than 4,500 U.S. retail websites. The share of sales coming from shoppers using tablets stood at 14%, down from 16% in 2014, the Adobe data shows.

Between midnight and 10 a.m. Central Time, U.S. consumers purchased $500 million online, or $100 million more than during the same period last year, Adobe says.

“Thanksgiving morning sales are off to a strong start, dominated early by mobile shopping, and today is expected to offer the highest overall discounts of the year,” says Tamara Gaffney, principal research analyst for the Adobe Digital Index. “Average discounts of 23% are 2% less than last year’s 25%, but prices are expected to continually drop as more Black Friday sales come online.”

If spending continues at the current level, Adobe expects $1.65 billion dollars to be spent online on Thanksgiving Day, up 18% from last year, Gaffney says.

ChannelAdvisor Corp.’s mid-day Thanksgiving report shows e-commerce sales soaring 50.6% year over year for its e-retailer clients, many of which sell on Amazon and eBay.

Sales for ChannelAdvisor retailer clients on Amazon were up 31.19% at mid-day, 11.1% on eBay, 59.54% on Google Shopping, 41.3% on comparison shopping engines such as NexTag and Shopzilla, and 217.6%. on other web marketplaces (excluding Amazon and eBay). Sales from paid search ads for ChannelAdvisor clients were ahead 4.7% over last year.

Scot Wingo, executive chairman of ChannelAdvisor, an e-commerce services provider that helps retailers sell through online marketplaces. “To put this in perspective, last year we saw 19% growth for mid-day Thanksgiving and we ended Thanksgiving up 20%.”

The e-commerce trend is staying strong after IBM reported online sales up 35% Wednesday over the same day last year and up 21% Tuesday over the prior year.

On Thanksgiving Day, consumers are spending more per order, as the average order value jumped more than $5 from a year ago to $142.55, according to IBM Watson Trend, which tracks spending by monitoring millions of transactions from retail websites of IBM Corp. clients.

The IBM data shows smartphones and tablets are accounting for 27.83% of the online sales as of late Thanksgiving morning.

The hot-selling products on Thanksgiving Day are Apple watches, Samsung 4K TVs, Sony PlayStaton 4, Xbox One, and Beats by Dr. Dre, according to IBM and Adobe.

A report by SimilarWeb, a digital intelligence firm, released Wednesday, shows web-only retailers gaining ground on retailers with both online and store sites.

The data show U.S. consumers spend on average 22% longer shopping on sites of retailers that sell only on online, according to SimilarWeb’s analysis, which looked at an index of leading U.S. retailers covering 47% of U.S. retail traffic.

It also shows online-only eBay secured a market-leading average customer session of 10 minutes 39 seconds among U.S. shoppers. Amazon.com kept customers engaged for 8:50 minutes, followed by Zulily (8:48 minutes) and Etsy (8:33 minutes). In contrast, the least engaging multichannel retailer’s site kept shoppers on their website for half this time—at 4:31 minutes, according to SimilarWeb. Even the best performing multichannel sites, those of Kohl’s and IKEA, averaged 7:49 minutes per session—almost 2 minutes less than Amazon and eBay, the analysis says.

Hilla Meller, SimilarWeb digital insights manager, says retailers that sell both through stores and online are more likely to rely on a boost from holiday traffic than those that sell only on the web.

Shopping days such as Thanksgiving, Black Friday and Cyber Monday provided multichannel online sites with an 84% traffic increase from October to December last year versus 41% for web-only merchants, Meller says. “However, there is a challenge for brick-and-mortar-based sites in maintaining these gains over a longer period of time and achieving the consistent engagement and popularity of their online-only competitors. Online-only sites get more steady traffic throughout the year and appear to have hit upon a more enticing formula for keeping customers engaged.”

Not all retailers are sharing in the good news about online sales growth.

William Bauer, managing director of Royce Leather Gifts, says so far this holiday season, “Our e-commerce sales are down 17.5% and our retail sales are down 22%.”

“Consumers still have the burden of the economy on their minds, and different quantitative metrics that indicate consumer confidence have confirmed that belief,” he says. “Despite improvements in wages, employment numbers and savings from decreased gasoline prices, there is a cautious pragmatism, if not paranoia, pervading the minds of our consumers.”

Bauer says the company is adapting its strategy by segmenting customers into four profiles: Procrastinators—"last minute shoppers;" Foxes— "Black Friday/Cyber Monday hunters;" "Early adopters," and Turtles—"slow and steady consumers."

“We are engaging shoppers at these different time periods throughout the holiday season shopping cycle and communicating with them at times most relevant for them rather than communicating en masse,” Bauer says. “Our advice to other retailers is to be flexible by creating variety in their deals to target each particular consumer profile.”

Bauer is keeping his hopes up for the remainder of the holiday season. “We remain optimistic in this weekend's potential to transform our outlook,” he says. “Should tomorrow's (Black Friday’s) revenue prove to be bleak, that will serve as an omen for the remainder of the year.”